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Podcast - Apple Report: iPhone - The Apple and AT&T Steamroller

by , 9:00 AM EDT, July 7th, 2007

Direct Link: MP3 Version

A week after the iPhone launch, Apple's combo iPod and smartphone is still going strong. This week Jeff and Bryan look at the iPhone market, Apple's climbing stock, and what the iPhone reviewers are getting right and wrong.

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Observer Comments

Show: Subjects Only | Full Comments
Close Name:Guest
Subject: iPhone has lots and lots of hidden costs.

You bought the iPhone for the full price (without the usual contract signing discount of 150 to 200), and you have to agree to the 2 year contract. Later on when you want a new phone battery you have to ship your phone to Apple and they wil, for 79 dollars give you a new battery. Replacement of the battery takes 3 days and apple will let you borrow a phone for 30 dollars. YOUR PHONE IS ENDING UP COSTING YOU CLOSE TO A 1000 dollars.

Close Name:macinnerd Posts: 1748 Joined: 15 Jun 2005
Subject:

Did Apple specifically announce the $30 Fee for the replacement phone and the $75 fee for the Battery?

And the Contract: why is that a hidden cost?

Besides if people want to buy it, what's wrong with that?

Close Name:Guest
Subject:

I said it's hidden because the battery replacement costs were announced today.

Close Name:Intruder -   TMO Mac Specialist Posts: 3149 Joined: 07 Jul 2004
Subject:

Quote
Anonymous wrote:
I said it's hidden because the battery replacement costs were announced today.


Except that it was announced on 2 July or earlier. It was posted at Apple on 2 July.

There will, no doubt, be third parties that will provide battery replacement services for the iPhone at a lower cost, just as happened with the iPod.

But, if you don't like all of the "hidden" costs, then don't buy an iPhone. Seems pretty simple.

Close Name:Engine Joe Posts: 413 Joined: 29 Jun 2004
Subject:

Quote
Intruder wrote:


But, if you don't like all of the "hidden" costs, then don't buy an iPhone. Seems pretty simple.


Because I'm sure he finds it much more fun to bitch on messageboards than to do useful things with his time.

Close Name:Guest
Subject: Give them the moon...

... and they will ask "where are the stars?"

Alas, too much is not enough here. I am surprised people are not asking for the ability to give life with this thing!

Close Name:Guest
Subject:

"Cost close to 1000 dollars"

But still cheaper than any of the non-iphone current contracts. No?

Close Name:Guest
Subject: Oh THOSE hidden costs ... wait ... what?

Since I have a bag full of troll food today...

What hidden costs?

1) You paid "full" price and signed a contract - you knew that when you bought the phone (before actually; with all the press coverage for the iPhone it was almost universally known that there'd be no <extra> discount anytime in the near future, and anybody buying a cell phone in this day and age knows there is contract involved). Regardless, the costs were stated up front (the price for the phone was the advertised price, not a "price after rebate" price - like every other phone out there is advertised with), that's the opposite of hidden, they told you the cost.

2) New battery? Did <anyone> think replacement batteries (disregarding defect/warranty issues) were free? Even cheap (as in shoddy), low capacity phone batteries aren't cheap, so what makes you think that the high-capacity battery in an iPhone would be free? And if you had the least bit of common sense, you could have roughly estimated the replacement cost by looking at the cost of the iPhone itself and the iPod's battery replacement cost. But forget the cost, unless it's a defective battery, how often do you think it'll need replacements? I don't know about you, but it's reasonable to expect 3 years <at least> from even cheap cellphone batteries these days. Regardless, a battery in an electronic device is a consumable element, do you buy cars (or trucks, motorcycles, etc...) and expect the manufacturer to provide the gas for you? Seriously.

3) Rental fee for a rental phone? Good god, the madness! While we're at it, why don't we call out Hertz/Enterprise/Rent-a-wreck for charging a rental fee for rental vehicles. And before anyone make a free loaner-car analogy for cars being serviced, those aren't really all that common, and when offered, loaners aren't going to be top-of-the-line (like the iPhone), even if your car being serviced is. Besides, who says Apple has to provide a loaner at all (for a fee or otherwise) while they service a phone? That was <never> a stated part of the deal - it's a bonus.

Where are the "lots and lots of hidden costs"?

...Mmmmm, tasty troll-food.

Close Name:Guest
Subject: all cell phones reduce power when close to tower

All cell phones adjust the power they use to communicate to the cell tower depending on how close it is. If you are always in low signal areas ALL cell phones will have reduced battery life vs if you are in high signal areas.

This is why cell phones on airplanes cause problems, due to the distance all cell phones on the airplane will blast signals at max power trying to communicate to a tower. By placing a "tower" on the airplane the cell phones will use their low power mode to communicate and thus reduce the likelihood of interfering with the airplane radio communications.

Close Name:Guest
Subject:

He is raising a legitimate issue concerning the iPhone's additional costs charged by Apple. These battery replacement costs were not announced alongside the phone's other costs, such as the price of the phone and AT&T's service plans. Thus, these costs were hidden, in that they are relevant, but were not announced with other costs. Hidden does not mean invisible--it means placing something in an inconspicuous/unexpected location. Thus, burying the cost in a website link could be hiding it--Apple is not withholding the costs, but is placing them in an unexpected place with the hopes that people don't notice, while still being able to claim disclosure.

Also, it's obvious he would not buy an iPhone if this one factor was a show-stopper. This guy is simply posting a concern, which as a potential/current Apple customer, I would think Apple would want to know. Unless you're suggesting that Apple doesn't care what consumers think of its products and practices?

Close Name:Guest
Subject:

Before I begin, I should note that I posted "Oh THOSE hidden costs ... wait ... what?". I suppose I should register, it would make it easier to hold me responsible for my rambling postings .

The original poster's assertion that the "iPhone has lots and lots of hidden costs", is unwarranted, and in my opinion a deliberately inflammatory ("troll") comment - although I will admit that my interpretation is just that and may not be an accurate assessment of the OP's intent (such is the limitation of impersonal anonymous internet posting). But given my experience and understanding, the original assertion is not logically supported and thus not legitimate.

The original poster indicates a multiplicity of costs exist, but only justifies their argument with one - the battery replacement cost. A phone rental fee is an optional cost elected by the consumer and not required for the use of the purchased device nor the replacement of a battery and thus is irrelevant to the discussion and fails as a supporting argument. Also the "full price" comment and contract fees were defined and advertised well in advance of anyone's purchase, and are completely unrelated to any claim of undisclosed costs (the original poster's stated subject of discussion).

Back to the first item; a battery replacement is not a normal component of the total cost of ownership for a cell phone (for most users). An important point to remember is that despite it's [currently hefty] price tag, the iPhone is a piece of "disposable" electronics with a relatively short expected lifetime (on the order of three to five years). It may physically function perfectly well for many years beyond that timeframe, but for a significant number of users it will be replaced by "the next best thing" at the end of that span (more a cultural artifact than a technical one - but that's a whole other discussion). Does anyone else remember the V3 Razr when it was first released several years ago? You could easily expect to pay several hundred dollars ($350.00+), and now many (but certainly not all) of us who bought them are looking to upgrade to the iPhone (or have long since upgraded to a more advanced "smart phone"). In the absence of any other [battery reliability/life span] information, it can be assumed that the iPhone's rechargeable battery will last the [expected use] lifetime of the the phone (as is the case with many quality phones already available, cheezy-free-throw-away phones don't count), so aside from faulty batteries (which should be replaced under warranty), and extreme usage conditions (outside the accepted norm), battery replacement cost becomes an irrelevant factor. But, if the battery replacement cost (or any other cost) were a significant factor to a consumer (e.x. they intend to maintain the device beyond the normal life span or repeatedly use it for extreme durations in Wi-Fi mode, and may require a replacement battery before or after that 3-5 year window), the onus lies with them to research and evaluate cost factors for themselves. If the desired cost information is not readily available to a consumer, it becomes their decision whether or not to proceed with a purchase (knowing that they lack the information they initially desired).

The other contention is that the costs were obscured because a replacement battery was not announced simultaneously with the iPhone, is also flawed. Until a consumer product is officially announced or first made available for purchase, it effectively does not exist. You can't conceal or abscure the cost of a product that doesn't exist (or can't be purchased). There is no absolute responsibility for a manufacturer to provide replacement parts for any product to the public (except insofar as is legally required by explicit or implied warranty coverage terms). Apple could have just as easily never started selling replacement batteries for the iPhone. If it were an important consideration in the purchase of the iPhone, it comes back to the consumer to wait until a battery replacement was announced, if ever, whether it be by Apple itself or a third party, before making their purchase. One could assume that replacement batteries would be made available at some point, but it would be just that, an assumption. Apple may not have initially intended to release a battery replacement product (except for warranty repairs), but after release of the phone realized that there was a consumer interest in it, and quickly put together a product package for sale. Or perhaps, the announcement of a battery was delayed by a few days because of an unforeseen change in market conditions (supply/manufacturing/etc..) just before the announcement was to be made. Once you start speculating the the availability of an unannounced product, you can only speculate on the cost of the product, and that makes it your fault if you're wrong. As for Apple's "placing something in an inconspicuous/unexpected location"; the cost of the replacement battery was (and is) stated right alongside the information indicating the availability. If the page which contained the price of the battery were not the same page as the page noting the availability of the battery (no matter how directly linked), I would agree that the cost was being hidden (or obscured). But that is not the case as the product (battery) and price are listed together - side by side.

The (slightly) shorter version is this:
As far as we know right now, a replacement battery will never be required under normal circumstances, which makes this a moot point. However, if it's important to you to know the price of a replacement battery before you buy a phone (maybe you know you'll use it outside the expected usage circumstances, or you just like to play it safe and know), then <you> have to go find out what it will cost (which may involve waiting until said costs are made publicly available). If you don't, and buy the phone anyway, you've made a choice and can't honestly cry foul, because <you> made a choice.

And just as a P.S.
Is there any precedent for replacement batteries be announced in a showcase along with a cell phone? I don't ever remember one. Maybe in a separate "page 2" announcement shortly after availability, with the other accessories, but that's essentially what Apple did in this case anyway...

Close Name:Intruder -   TMO Mac Specialist Posts: 3149 Joined: 07 Jul 2004
Subject:

Now there you go, using logic again...!




Excellent response, btw.

Close Name:rickla Posts: 1 Joined: 09 Jul 2007
Subject: Boost Jeff!

I love the show, but have a problem with the volume balance. If I boost it enough to hear Jeff clearly in my office, Bryan comes out too loud and I get complaints from next door. Any chance of using a bit of compression and gain or just manually boosting Jeff?

Close Name:Guest
Subject: 3/3 ... Last one I promise :)

I didn't really grasp just how much I was typing when I was doing it - wow. Man, I can really run off at the mouth (or keyboard as it were). That's a lot words, I didn't think I even knew that many! I really must like to argue, sorry 'bout that. ;P

I seriously should register though, maybe I'll even get to it some day - if I can stop with all the typing...

I'm done.

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